Determining and Identifying Financial Risks for Companies

Abstract

Bankruptcy is a process registered in the operation of the free market economy. The basis for this phenomenon is very complex and it possesses economic, legal, and even social repercussions. With the recent financial crisis and the problems of many businesses in our country, it is certainty unfortunately that the issue of bankruptcy is still current and present in the present reality. With regard to the consequences of this phenomenon being of not only an economic nature but above all of a social one, it’s worth looking to a rapid assessment of a company’s financial problems, which a financial unit by unit analysis would give. This paper aims at showing the economic issues related to the financial risk of a company as well as attempting to form models for forecasting bankruptcy in individual cases in current Polish conditions.